The ‘Corkman’ Pub demolition – a cautionary tale for land owners.

It is exceptionally rare for a breach in town planning legislation to result in a prison sentence. However, that is exactly the circumstance facing two landowners of a Melbourne City site. Fearing they would not receive the necessary approvals to demolish the heritage building on the site, these unscrupulous owners decided to demolish the building anyway and thought they would be allowed to redevelop the land. However, they greatly underestimated the public backlash and the appetite of the Victorian Government to hold them accountable for the deplorable act. Heritage protection controls are some of the most stringent planning controls that can affect a site and limit the development potential. Any buildings and works to a heritage property can significantly impact and sometimes destroy the heritage fabric of a place so any proposed alterations are carefully scrutinised by heritage experts prior to any building work being completed. The importance of heritage conservation to locally elected councillors and the community was emphasised in a highly publicised case during 2016 within Melbourne city council where the owners of a historic pub that was included in the Victorian Heritage Register was demolished without the necessary approvals.

The building in question was located in Carlton and known as the ‘Corkman Pub’. The building was built in 1858 and in the space of a weekend in October 2016 was fully demolished by the owners. The owners were taken to court for the illegal act in 2019 where a magistrate described the act as ‘reprehensible’ before issuing large fines to the owners which you can read about at this link. The owners originally committed to rebuilding the pub but reneged on this commitment and agreed to clear the site and provide a park instead.     

In December 2020 the owners appeared in the news again because they were sentenced to 30 days in jail for contempt of court. In an article published in the Age newspaper two of the owners were described as being jailed as a result of their failure to honour a commitment made during legal proceedings to construct a park on the site. The Supreme Court judge in the matter said the owners had ‘thumbed their noses’ on the previous court order that they act quickly to clean the site and construct the park. Planning Minister Richard Wynne welcomed the decision and said it was appropriate. He added that the government could compulsorily acquire the site but this scenario seems unlikely given the high price tag the site would demand.  The sentiments of Minister Wynne were echoed by Melbourne lord Mayor Sally Capp and the liberal opposition planning spokesman Tim Smith. Mayor Capp added that this ruling sends a message to developers that council won’t tolerate developers disobeying court orders or formal agreements.  

It is commonplace for land owners to consider ‘heritage overlays’ and ‘heritage listings’ as significant barriers to the development potential of sites. While there is credence to this belief, it is not true to say that just because a property has some form of heritage control that the site is undevelopable and demolition is not possible. Below we look at the town planning heritage controls that can affect a site and describe the likely implications of each for the development potential of the site.

  1. A site included in the Victorian Heritage Register.

These sites undoubtly enjoy the greatest level of heritage conservation of any controls that exist. The inclusion of a building or site on the heritage register signifies it is of state significance and is usually accompanied by a ‘Statement of Significance’ that you can read to understand why the property merits inclusion in the state register. The ‘Corkman’ Pub mentioned above was a building that was included in the register and therefore highly protected. It is unlikely its demolition would have been supported and this provides some insight into why the owners rushed the demolition in the space of one weekend and did not seek approvals in advance.

Any demolition, extension or buildings and works to a property included in the register are subject to approval by the department of environment, land, water and planning (DELWP). In some circumstances, where buildings and works are minor the department can issue you an exemption letter like the below one pictured. This exemption is issued when DELWP are comfortable that the proposed works will not impact the heritage fabric of the property and you can continue with the proposal. If the department do not issue an exemption like the below then you will need to apply for a formal permit to undertake the works on the site. This can take months to be approved and is processed similar to a planning permit application.

An important note about properties on the state register is that they are not subject to approval by the local council through a planning permit. Unless there is a subdivision element to the proposal, the local council are not involved in the approval of any buildings and works. This means that once you have your approved exemption from DELWP or an approved permit if required then you do not need to apply to the local council for a planning permit.

  1. A site specific heritage overlay

An individual site that is subject to a ‘standalone’ heritage overlay and not included in the state register mentioned previously has been identified by the local council as being of significant heritage value. These sites or buildings have features and characteristics that the local council have deemed necessary for conservation or protection but are not necessarily significant enough to be included on the state register. Similar to properties on the state heritage register these properties will often be accompanied by a ‘statement of significance’ that explains why the property has been included within an overlay and what features of the property are important to retain. Outright demolition of a property that has a site specific heritage overlay is unlikely to be permitted by the local council. Modifications and extensions to properties are supportable on the basis they meet the requirements of the statement of significance. The statement of significance for these properties is usually contained within the ‘Incorporated documents’ section of the planning scheme but can also often be found as a local planning policy clause in some planning schemes.

  1. A precinct heritage overlay

This is the most common type of heritage control affecting properties. The difference between a ‘precinct’ overlay and a ‘site specific’ overlay mentioned previously is that a precinct overlay will cover multiple properties and streets and contain a ‘statement of significance’ that describes, in broader terms the common elements of these properties that are worthy of heritage conservation. Typically a ‘statement of significance’ for a precinct overlay will include a list of properties that are either ‘contributory’ or ‘non-contributory’ to the heritage conservation. The classification of a property as 'contributory' or 'non-contributory' is a very contentious issue and something local councils have to deeply research before deciding. Typically Council will outsource this task to a reputable and impartial heritage consultancy firm. That firm will then define the elements of heritage conservation that are commonplace within a precinct and make a recommendation about whether each individual property that makes up the precinct should be classed as ‘contributory’ or ‘non-contributory’.

Some landowners welcome the security that is perceived by their property being defined as 'contributory' under a heritage overlay. They know the features of their property are unlikely to be greatly modified. The majority of landowners would prefer their property be classed as ‘non-contributory’ because of the perceived negative impact on future development potential and land value decline that can result from a ‘contributory’ classification. It is fair to say that councils consent for demolition of a ‘non-contributory’ building is more likely to be approved than a proposal to demolish a ‘contributory building’. However a ‘contributory’ classification does not prohibit or prevent a future extension on your property. It does impede the possibility of an outright demolition of the building being supported in the future. In my experience the only circumstances that the local council will support the demolition of a ‘contributory’ heritage building is when the building is in severe disrepair and the costs of restoration of the building are prohibitively expensive on the landowner.

Heritage controls are a complex but necessary town planning control that exists. The tale of the ‘Corkman’ pub should serve to warn any landowner seeking to circumvent those controls that the legal ramifications can be grave. On the flip side, landowners can often overestimate the limiting impact inclusion within a precinct heritage overlay can have on the development potential of their site. If you have a property within a heritage overlay it is important to find out which of the three types of heritage controls described here affect your property. Our helpful team can answer this question for you quickly and confirm for you the exact implications of the heritage controls affecting your property for the future development potential and value of your site.  

Paul O'Shea is the Managing Director of CS Town Planning Services. He has had vast experience in solving complex planning issues and assessing a wide range of planning development applications, as well as hands-on experience in client representation at VCAT. Paul's career has spanned Dublin, New York and now Melbourne.